Pdvsa's debt instruments about to hit historical high
Investment funds bet on a possible political change in the South American country
Foreign investment funds are speculating about a likely political change in Venezuela and have increased the purchase of Venezuelan bonds, thus fueling the price of the South American country's debt instruments.
Investors believe that the bonds they are purchasing will be worth much more if a new administration replaces Hugo Chávez's government following the presidential election to be held in October 2012. President Chávez has cancer and has drastically reduced his public appearances in the past two weeks.
The price of Venezuelan bonds that are traded abroad, both Pdvsa and government papers, has risen two percentage points despite pessimism in the market in view of the possibility that the euro zone crisis can be worsened by the Spanish recession.
Pdvsa's bonds due in 2022 are currently traded at 103%, near its historic high (104%) whereas the Global 22 is trading at 107.5%.
With reporting by Víctor Salmerón
The very early morning after the presidential election (April 15), both candidates requested the National Electoral Council (CNE) to conduct a full audit of the process: one, Henrique Capriles, because he asserts that the election results are different from the ones announced, and the other one, Nicolás Maduro, in order to clear any doubt regarding his victory, and to reinforce his political stance. Nevertheless, as it is already known, President Maduro changed his mind.